The decade the Unions died

This is a horrible posting. I can’t help thinking it though. Yesterday’s tirade against teacher strikes by Michael Gove received such a tiny backlash, certainly in the media, that it’s hard to think that the Unions can pull off a great fight again.

That’s backed up what many pundits believe we’re about to see: the final showdown between the Unions and the country. In this final act, rudely interrupted by the resurgence of a right-leaning Labour Party between the miners’ strikes and now, the government successfully portrays Unionisation as an obsolete facet of the public sector, and shows why it’s time to call that sector a day because it can’t be controlled to the favour of the wider public.

The conclusion is then that it must be privatised (or mutualised) for the greater good.

Should that scenario play out, there could be a dreadful vacuum of mediated workplace relations in the free market. Which is a citizenship issue… If we actually do have (and need) the capability of collectively addressing factors that support social equality but think we’re powerless to do it in relation to the economy, then our national solidarity is undermined.

Over the last 30 years we’ve seen a whole new economic phenomenon that has contributed to inequalities of income: “pre-distribution” of wealth. Formerly taxation was our main form of wealth redistribution – ensuring that wealthier people wouldn’t get excessively well-off whilst poverty went overlooked. But taxation levels have come down such that it no longer has a huge effect (like the 90% of the 60s) in holding back the unfettered wealth of the super rich.

Instead we’ve been taught that participating in a global economy means we have to enable the super rich to enjoy their success or they’ll no longer stay in this country and make money for us.

So lowering taxation saw RE-distribution going down as taxes dropped to a ceiling at 40%. But what we’ve had at the same time is an increase in the PRE-distribution of wealth. By that I mean that the gap between lower paid workers and highest paid has increased to something like 20 fold. So instead of the managers earning 3 times as much as other workers, they can earn 25 times as much, before bonuses. Their income has been PRE-distributed without being subsequently RE-distributed anything like as much.

And there’s nothing we can do about that is there? The market is having its way, and we’re powerless against the market… what is the outcome of such social powerlessness?

The stats are overwhelming on the shocking effects of this inequality. The disparity causes physical and emotional suffering and erodes belief in justice while leaving in place the kind of envy that feeds disenchantment and a shadow economy. That builds ghettoes.

Labour has been consistently criticised for not halting this growth in inequality in its time in government, and on its watch the gap between lowest and highest salary levels actually increased through this Pre-distribution of wealth. There seemed to be no political tool to tackle this. No mechanism for “wage justice” other than the Unions.

‘In the old days’ these were seen to be issues for Unions to resolve. They were the civil society organisations that represented the breadth of the workforce and insisted that the whole of the company should benefit from its success, not a disproportionate number of managers over basic grade workers: not such a high differential across the company. The government would encourage this – implicitly supporting fairness in the workplace as contributing to social stability. It could still do this through the Office for Civil Society.

Perhaps this is the reason that some people believe that citizenship should be taught as part of History. There used to be ways to turn this around, to avoid that disparity of Pre-distribution. If those things become history, these just could be the good old days.

Alternatively – we teach the problem, and ask students to consider what options they’d prefer? What will Wage Justice mean in 20 years time?

Views expressed on this blog are not necessarily those of the Citizenship Foundation.

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